Diamond Hill Capital Management Inc. Sells 121,819 Shares of Salesforce Inc. $CRM

Key Points

• Diamond Hill Capital Management cut its Salesforce stake by 7.4% in the fourth quarter, selling 121,819 shares. The firm still held 1.53 million shares worth about $405.5 million, making Salesforce its 10th largest holding.
• Salesforce reported a strong quarter, with EPS of $3.81 versus estimates of $3.05 and revenue of $11.20 billion, both ahead of expectations. Revenue rose 12.1% year over year, and the company reiterated upbeat FY2027 guidance.
• The company also announced a $25 billion share buyback authorization and raised its quarterly dividend to $0.44 per share. Meanwhile, Wall Street remains mixed but generally positive, with an average rating of Moderate Buy and a consensus price target of $274.12.

Diamond Hill Capital Management Inc. reduced its position in shares of Salesforce Inc. (NYSE:CRM - Free Report) by 7.4% during the 4th quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission. The institutional investor owned 1,530,749 shares of the CRM provider's stock after selling 121,819 shares during the quarter. Salesforce accounts for approximately 2.1% of Diamond Hill Capital Management Inc.'s investment portfolio, making the stock its 10th biggest holding. Diamond Hill Capital Management Inc. owned approximately 0.16% of Salesforce worth $405,511,000 at the end of the most recent reporting period.

A number of other large investors have also recently added to or reduced their stakes in the company. Board of the Pension Protection Fund acquired a new position in shares of Salesforce during the 4th quarter worth about $26,000. Key Capital Management INC acquired a new stake in Salesforce in the 4th quarter valued at about $26,000. Legacy Bridge LLC bought a new position in Salesforce during the fourth quarter worth about $27,000. Dogwood Wealth Management LLC grew its holdings in Salesforce by 285.7% during the fourth quarter. Dogwood Wealth Management LLC now owns 108 shares of the CRM provider's stock worth $29,000 after purchasing an additional 80 shares during the period. Finally, Texas Capital Bancshares Inc TX acquired a new position in Salesforce during the third quarter worth approximately $28,000. Institutional investors and hedge funds own 80.43% of the company's stock.

Salesforce Stock Down 2.1%

CRM stock opened at $176.35 on Friday. Salesforce Inc. has a fifty-two week low of $163.52 and a fifty-two week high of $286.35. The company has a debt-to-equity ratio of 0.18, a current ratio of 0.76 and a quick ratio of 0.76. The stock has a market capitalization of $144.30 billion, a price-to-earnings ratio of 22.58, a PEG ratio of 1.25 and a beta of 1.14. The business's fifty day moving average price is $182.53 and its two-hundred day moving average price is $213.21.

Salesforce (NYSE:CRM - Get Free Report) last announced its earnings results on Wednesday, February 25th. The CRM provider reported $3.81 earnings per share (EPS) for the quarter, beating analysts' consensus estimates of $3.05 by $0.76. Salesforce had a net margin of 17.96% and a return on equity of 15.38%. The company had revenue of $11.20 billion during the quarter, compared to analysts' expectations of $11.18 billion. During the same quarter in the previous year, the business posted $2.78 earnings per share. Salesforce's quarterly revenue was up 12.1% on a year-over-year basis. Salesforce has set its FY 2027 guidance at 13.110-13.190 EPS and its Q1 2027 guidance at 3.110-3.130 EPS. On average, equities analysts anticipate that Salesforce Inc. will post 9.71 earnings per share for the current year.

Salesforce declared that its Board of Directors has approved a share buyback program on Monday, March 16th that authorizes the company to repurchase $25.00 billion in outstanding shares. This repurchase authorization authorizes the CRM provider to buy up to 14.1% of its stock through open market purchases. Stock repurchase programs are usually a sign that the company's board believes its shares are undervalued.

Salesforce Increases Dividend

The firm also recently disclosed a quarterly dividend, which was paid on Thursday, April 23rd. Shareholders of record on Thursday, April 9th were issued a $0.44 dividend. The ex-dividend date of this dividend was Thursday, April 9th. This represents a $1.76 dividend on an annualized basis and a yield of 1.0%. This is an increase from Salesforce's previous quarterly dividend of $0.42. Salesforce's payout ratio is presently 22.54%.

Insider Buying and Selling

In other Salesforce news, Director Laura Alber bought 2,571 shares of the stock in a transaction dated Thursday, March 19th. The shares were bought at an average cost of $194.58 per share, with a total value of $500,265.18. Following the completion of the acquisition, the director owned 9,530 shares of the company's stock, valued at $1,854,347.40. This trade represents a 36.94% increase in their ownership of the stock. The purchase was disclosed in a document filed with the SEC, which is accessible through this link. Also, Director David Blair Kirk purchased 2,570 shares of the company's stock in a transaction dated Wednesday, March 18th. The stock was acquired at an average price of $194.62 per share, with a total value of $500,173.40. Following the completion of the transaction, the director owned 13,689 shares of the company's stock, valued at $2,664,153.18. This represents a 23.11% increase in their position. The disclosure for this purchase is available in the SEC filing. Corporate insiders own 3.50% of the company's stock.

Wall Street Analyst Weigh In

A number of research firms have recently issued reports on CRM. Oppenheimer cut their price objective on Salesforce from $275.00 to $250.00 and set an "outperform" rating for the company in a research report on Thursday, February 26th. BMO Capital Markets dropped their price target on Salesforce from $235.00 to $225.00 and set an "outperform" rating on the stock in a research note on Thursday, February 26th. Morgan Stanley dropped their price objective on shares of Salesforce from $398.00 to $287.00 and set an "overweight" rating on the stock in a research report on Monday, February 23rd. Mizuho reduced their target price on shares of Salesforce from $280.00 to $265.00 and set an "outperform" rating for the company in a report on Thursday, February 26th. Finally, Truist Financial set a $280.00 price target on shares of Salesforce in a research note on Thursday, February 26th. One analyst has rated the stock with a Strong Buy rating, twenty-five have issued a Buy rating, ten have assigned a Hold rating and three have given a Sell rating to the stock. According to data from MarketBeat.com, the stock presently has an average rating of "Moderate Buy" and an average price target of $274.12.

Salesforce News Summary

Here are the key news stories impacting Salesforce this week:

• Positive Sentiment: Deutsche Bank reiterated its Buy rating on Salesforce and kept a $255 price target, saying it expects a “seasonally slow but steady” start ahead of earnings. Deutsche Bank Stays Positive on Salesforce (CRM), Citi Lowers PT
• Positive Sentiment: Cint expanded its relationship with Salesforce to deliver next-generation AI-powered support, reinforcing demand for Salesforce’s Agentforce and Slack-based enterprise AI tools. Cint and Salesforce to Deliver the Next Generation of AI-Powered Support
• Positive Sentiment: Several articles highlighted Salesforce as a beneficiary of ongoing investor interest in AI and big data, and noted that the company’s upcoming earnings report is expected to show growth and could support another beat. Wall Street's Insights Into Key Metrics Ahead of Salesforce (CRM) Q1 Earnings
• Neutral Sentiment: Analyst commentary around CRM remains mixed overall, with some broker notes still constructive while valuation-focused pieces question how much growth and AI moat are already priced in.
• Negative Sentiment: Citi reportedly lowered its price target on Salesforce due to slower deal activity and rising competitive pressure, adding to investor caution. Citi Lowers Target on Salesforce (CRM) Over Slower Deal Activity
• Negative Sentiment: Bank of America reinstated an Underperform rating and a $160 price target, arguing Salesforce faces an “AI-driven structural reset,” which weighed on sentiment. Salesforce rated ‘Underperform’ by Bank of America on AI growth concerns

Salesforce Profile

Salesforce, founded in 1999 and headquartered in San Francisco, is a global provider of cloud-based software focused on customer relationship management (CRM) and enterprise applications. The company popularized the software-as-a-service (SaaS) model for CRM and has built a broad portfolio of products designed to help organizations manage sales, service, marketing, commerce and analytics through a unified, cloud-first platform.

Core offerings include Sales Cloud for sales automation, Service Cloud for customer support, Marketing Cloud for digital marketing and engagement, and Commerce Cloud for e-commerce.

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